Mr Glen Hughes v Fire Protection Design & Management Pty Ltd

[2021] FWC 5996

[2021] FWC 5996

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009 (Cth)
s.394 - Application for unfair dismissal remedy
s.400A – Costs against parties in unfair dismissal matters.
s.401 – Costs against lawyers and paid agents in relation to an unfair dismissal matter.

Mr Glen Hughes
v
Fire Protection Design & Management Pty Ltd
(U2020/15201)

DEPUTY PRESIDENT CROSS SYDNEY, 28 SEPTEMBER 2021

Application by applicant for costs arising from respondent’s application for costs in unfair dismissal application. Application dismissed.

[1] A Form F6 application for costs (the Form F6) was filed on 11 August 2021 (the Application), by Mr Glen Hughes (the Applicant), pursuant to ss.400A, 401 and 611 of the Fair Work Act 2009 (Cth) (the Act). The Application related to a previous application for costs (the Respondent’s Costs Application) by Fire Protection Design & Management Pty Ltd (the Respondent) that was the subject of my previous decision dated 4 August 2021 (the August Decision). 1

[2] The August Decision outlines in detail the history of the proceedings the subject of this matter. Where relevant I will refer to the contents of the August Decision.

[3] The grounds upon which costs were sought were outlined in the Application as follows:

1. The Respondent’s act in filing their Form F6 costs application on 17 March 2021 was unreasonable; and

2. The Respondent’s omission in not discontinuing their costs application on or after 17 March 2021 was unreasonable.

3. As per the Deputy President’s decision dated 4 August 2021, the Respondent and/or the Respondent’s solicitor behaved unreasonably, see [7], [62], [65], [66], [68] and [70].

4. The fact that the Respondent applied for costs, despite their own conduct through the proceedings, was itself an unreasonable act that caused the Applicant to incur costs needlessly in defending its position.

5. It ought to have been apparent to the Respondent at all times on or after 17 March 2021 that their costs application had no prospect of success.

[4] On 25 August 2021, in an attempt to stem the continuing costs associated with this litigation, I issued directions that only imposed an obligation on the Applicant to file materials in support of the Application. That direction was as follows:

1. Mr Glen Hughes (the Applicant) is directed to file with the Fair Work Commission, and serve on Fire Protection Design & Management Pty Ltd (the Respondent), a detailed outline of submissions, witness statements and other documentary material the Applicant intends to rely on in support of the costs application in this matter by 4pm on 8 September 2021.

[5] On 2 September, the Applicant filed a document titled “Outline of Submissions of the Costs Applicant” (the Applicant’s Submission).

The Applicant’s Submission

[6] The Applicant sought costs on the following bases:

(a) The Respondent’s Costs Application was made vexatiously or without reasonable cause pursuant to s.611(2)(a) of the Act; and/or

(b) It would have been reasonably apparent that the Respondent’s Costs Application had no reasonable prospects of success pursuant to s.611(2)(b) of the Act.

(c) Also, or in the alternative, it was an unreasonable act or omission in connection with the conduct or continuation of the matter for the Respondent to continue to pursue the Respondent’s Costs Application.

[7] The Applicant noted that the Respondent’s Costs Application identified seven alleged unreasonable acts or omissions of the Applicant. The Applicant submitted that the Respondent would have been well aware that at least four of the seven listed alleged unreasonable acts or omissions of the Applicant had no reasonable prospects of success and/or were vexatious and/or without reasonable cause. The Applicant submitted that had the Respondent not pursued those four matters in the Respondent’s Costs Application, the Applicant would not have incurred the extra costs and work necessary to address each of those grounds. The Applicant sought full, or in the alternative partial, costs for the Respondent’s Costs Application.

[8] The four challenged allegations in the Respondent’s Costs Application were the first four of the seven allegations identified by the Respondent, being that:

(1) The lodging of the Form F2 was the first unreasonable act of the Applicant in connection with the conduct of the matter (the First Unreasonable Act or Omission).

(2) The failure of the Applicant to respond to the offer of reinstatement in the amended Form F3 was submitted to be the second unreasonable act of the Applicant in connection with the conduct of the matter (the Second Unreasonable Act or Omission).

(3) The conduct of the Applicant/Applicant’s solicitor during the conciliation conference was submitted to be the third unreasonable act of the Applicant (the Third Unreasonable Act or Omission).

(4) The failure of the Applicant to file a form F50 by 29 January 2021 (the Fourth Unreasonable Act or Omission) was submitted to be unreasonable.

[9] Regarding the relevant legislation and case law, the Applicant’s submission provided a largely similar copy (including footnotes) of the part of the Commission’s Benchbook regarding Unfair Dismissals dealing with costs, with which I unsurprisingly concur, as follows:

5. “Section 611 of the Act provides as follows:

(1) A person must bear the person's own costs in relation to a matter before the FWC.

(2) However, the FWC may order a person (the first person) to bear some or all of the costs of another person in relation to an application to the FWC if:

(a) the FWC is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or

(b) the FWC is satisfied that it should have been reasonably apparent to the first person that the first person's application, or the first person's response to the application, had no reasonable prospect of success.

6. According to relevant case law, ‘vexatious’ means that:

(1) The main purpose of an application (or response) is to harass, annoy or embarrass the other party; 2 and/or

(2) There is another purpose for the action other than the settlement of the issues arising in the application (or response). 3

7. The question of whether an application was made ‘vexatiously’ looks to the motive of the applicant in making the application. It is an alternative ground to the ground that the application was made ‘without reasonable cause’ and may apply where there is a reasonable basis for making the application. 4

8. The test for ‘without reasonable cause’ is that the application (or response):

(1) is ‘so obviously untenable that it cannot possibly succeed’;

(2) is ‘manifestly groundless’;

(3) is ‘so manifestly faulty that it does not admit of argument’;

(4) ‘discloses a case which the Court is satisfied cannot succeed’; and/or

(5) ‘under no possibility can there be a good cause of action.’ 5

9. The Commission may also consider whether, at the time the application (or response) was made, there was a ‘substantial prospect of success.” 6 It is inappropriate to find that an application (or response) was without reasonable cause if success depends on the resolution of an arguable point of law.7 An application (or response) is not without reasonable cause just because the court rejects a person's arguments.8

10. A proceeding is not to be classed as being instituted without reasonable cause simply because it fails, but rather in circumstances where on the applicant's own version of the facts, it is clear that the proceeding must fail. 9

11. Whether it should have been reasonably apparent that an application (or response) had no reasonable prospect of success is an objective test. 10

12. A finding that an application (or response) has no reasonable prospects of success should be reached with extreme caution and should only be reached when an application (or response) is ‘manifestly untenable or groundless.’ 11

13. An objective test considers the view of a reasonable person. In this case it looks at whether it would have been apparent to a reasonable person that an application or response had no reasonable prospect of success. This is the appropriate test.

14. Section 400A of the Act sets out additional circumstances in which the Commission can make orders against the parties in unfair dismissal matters:

(1) The FWC may make an order for costs against a party to a matter arising under this Part (the first party) for costs incurred by the other party to the matter if the FWC is satisfied that the first party caused those costs to be incurred because of an unreasonable act or omission of the first party in connection with the conduct or continuation of the matter…

(2) This section does not limit the FWC's power to order costs under section 611.

15. An unreasonable act or omission can include a failure to discontinue an unfair dismissal application or a failure to agree to terms of settlement. 12

16. What is unreasonable will depend on the circumstances. 13 It is intended that costs only be ordered where there is clear evidence of unreasonable conduct.14”

Consideration

[10] I am prepared to assume and, accordingly, I am satisfied that the Respondent caused costs to be incurred by the Applicant because of unreasonable acts or omissions in connection with the conduct or continuation of the Respondent’s Costs Application.

[11] I am not persuaded however that, in the exercise of my discretion pursuant to ss.400A or 611 of the Act, I should make an order for costs against the Respondent for the costs incurred and sought by the Applicant.

[12] It was made abundantly clear in the August Decision that I considered the conduct of the Applicant, and his legal representative, deserving of significant criticism. In particular:

(a) At paragraph [5] of the August Decision I found:

“Resolution of the Costs Application will necessarily involve consideration of the conduct of the legal practitioners. For the reasons outlined in the consideration of the Costs Application, I consider the conduct of the legal practitioners for each party to have been less than satisfactory, and neither could be characterised as attending with “clean hands.”

(b) At paragraph [7] of the August Decision I found:

“As the facts will disclose, this matter involved at times conduct falling short of the above duties, including discourteous dealings, obscure and inconsistent legal positions being taken, and conduct that can only be described as “point scoring.”

(c) At paragraph [67] of the August Decision I found:

“These alleged unreasonable acts or omissions are the more typical of such acts or omissions that may attract a costs order. The Applicant’s silence and inaction as directions approached and passed is deserving of censure, but I do not consider it warrants an order for costs.”

(d) At paragraph [69] of the August Decision I found:

“I accept that the Applicant chose to discontinue the UD Application with a view to pressing his rights to enforce the terms of the Deed elsewhere. That he did so late in the day before the hearing on 4 March 2021, was again deserving of censure, but I also do not consider it warrants an order for costs.”

[13] The Application is no more than an exercise where the Applicant is relying on the parts of the August Decision favourable to him, while completely disregarding those parts of the August Decision that are critical of him and his legal representative.

[14] Both the Applicant and the Respondent unreasonably caused costs to be incurred in the unfair dismissal proceedings and the Respondent’s Costs Application. In those circumstances, and in the exercise of my discretion pursuant to ss.400A and 611 of the Act, I decline to make an order for costs against the Respondent for costs incurred and sought by the Applicant.

Conclusion

[15] For the above reasons, the costs application made by the Applicant is dismissed.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

<PR734340>

 1   [2021] FWC 4741.

 2   Nilsen v Loyal Orange Trust (1997) 76 IR 180, 181; citing Attorney-General v Wentworth (1988) 14 NSWLR 481, 491; cited in Holland v Nude Pty Ltd (t/as Nude Delicafe) (2012) 224 IR 16 [7].

 3   Ibid.

 4   Church v Eastern Health (2014) 240 IR 377 [29].

 5   General Steel Industries Inc v Commissioner for Railways (1964) 112 CLR 125, 129; cited in Walker vMittagong Sands Pty Limited T/A Cowra Quartz [2011] FWA 2225 (Thatcher C, 14 April 2011) at para.17, [(2011) 210 IR 370].

 6   Kanan v Australian Postal and Telecommunications Union (1992) 43 IR 257; cited in Dryden v Bethanie GroupInc [2013] FWC 224 (Williams C, 11 January 2013) at para. 20.

 7   Ibid.

 8   R v Moore; Ex Parte Federated Miscellaneous Workers' Union of Australia (1978) 140 CLR 470, 473; cited in Walker v Mittagong Sands Pty Limited T/A Cowra Quartz [2011] FWA 2225 (Thatcher C, 14 April 2011) at para. 20, [(2011) 210 IR 370].

 9   Zornada v St John Ambulance Australia (Western Australia) Inc. (2013) 237 IR 48 [35].

 10   Baker v Salver Resources Pty Ltd [2012] FWAFB 4014 (Watson SDP, Drake SDP, Harrison C, 27 June 2011) at para. 10; citing Wodonga Rural City Council v Lewis (2005) 142 IR 188, 191 [6].

 11   Ibid.

 12   Explanatory Memorandum to Fair Work Amendment Bill 2012 at para. 170.

 13   Ibid, at 171.

 14   Ibid.